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2015 AV Vertical Markets
Global End-User Perspective
Corporate
Government
Education
Retail
Hospitality
Healthcare
Venues
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Copyright 2015 InfoComm International®
All rights reserved.
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Vertical Markets End-User Perspectives Study
Table of Contents
About InfoComm International ........................... 4
Introduction ........................................................ 5
Study Methodology............................................. 6
Research ...................................................... 6
Analysis ........................................................ 6
Assignment Timing....................................... 6
References ................................................... 6
Contact Information .................................... 6
Concerns and Challenges Impacting
End Users ......................................................... 65
Appendix .......................................................... 68
Geographic Region Definitions .................. 68
Vertical Market Segment Definitions......... 69
Global Contacts, by Region ........................ 71
End-User Interviews, by Vertical................ 72
Acclaro Growth Partners ........................... 73
Global Contacts................................................... 7
Retail: Vertical Market Assessment
End-User Interviews .......................................... 10
Executive Summary........................................... 11
Products and Technologies ............................... 14
Current AV Products and Technology
Adoption Life Cycle .................................... 14
Future AV Investment and
Five-Year Outlook ...................................... 20
End-User Investment Decisions......................... 24
AV Purchase Decision Driver ...................... 24
Channel Partners ....................................... 26
Impact of Convergence on AV Investment
Decisions .................................................... 32
Value of the Integrated Service Provider ... 35
AV Purchase Decision Factors Analysis ...... 36
Post-Installation Services Trends ............... 50
End-User Decision-Making Process ................... 54
AV Purchase Decision Organization and
Degree of Centralization ............................ 54
AV Budgeting Process and Sources of
Funding ...................................................... 57
Importance of ROI...................................... 58
Sources of Information for AV Decision
Makers ....................................................... 60
AV Purchase Process – Bid Out vs. Sole
Source ........................................................ 61
AV Purchase Process – Spec-Driven vs.
Consultative ............................................... 63
© InfoComm International® 2015
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About InfoComm International
InfoComm International® is the international trade association representing the professional audiovisual
and information communications industries. Established in 1939, InfoComm International has more than
5,000 members, including manufacturers, systems integrators, dealers and distributors, independent
consultants, programmers, rental and staging companies, end users and multimedia professionals from
more than 80 countries. InfoComm International is the leading source for AV standards, market research
and news. Its training, certification and education programs set a standard of excellence for AV
professionals. InfoComm International is the founder of InfoComm, the largest annual conference and
exhibition for AV buyers and sellers worldwide. InfoComm also produces trade shows in Asia, Europe,
Latin America and the Middle East. Additional information is available at infocomm.org.
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Vertical Markets End-User Perspectives Study
Study Methodology
InfoComm commissioned Acclaro Growth Partners to conduct a global vertical markets study covering
trends and dynamics from the perspective of end-user organizations in the corporate, education,
government, retail, healthcare, hospitality and venues segments.
Research
The data and information for this report was gathered through a combination of secondary research and
personal deep-dive conversations and interviews.
Secondary research drew on a wide range of published and online data sources to obtain relevant
information in each vertical market. Information obtained through secondary research was used to
support the interview process and make the interviews more effective. Insights were collected on
market trends, issues, drivers and constraints, with a focus on their impact to the end user.
The majority of the findings and perspectives put forth in this study were derived using primary
research. The primary research consisted of approximately 170 personal interviews and
conversations, the majority of which were with 130 end-user organizations in seven vertical markets
and in all regions of the world. Interviewees also included manufacturers, AV and ICT integrators,
distributors, manufacturer rep firms, design consultants and industry experts. See pages 7 and 8 for a
break out of the end-user interviews by region and by vertical market segments.
Analysis
Qualitative comments such as the majority (indicating more than 50 percent) and most (indicating more
than 75 percent) were used to indicate consistency of perspectives. End-user comments were used as
representative examples, are identified with quotations, and are attributed to the type of organization
making the specific comment. Comments such as several or some indicate multiple mentions but not
necessarily the majority of opinion or circumstance. One-off comments were not included unless
specifically identified.
Assignment Timing
The research and analysis for this study were conducted between January and May, 2015.
References
Please refer to the Appendix for definitions of the geographic and vertical market segment terminology
used in this document.
Contact Information
Acclaro Growth Partners:
Julia Baillie, Partner | Phone: +1.604.983.3735 | [email protected]
InfoComm International:
Kaitlyn McAuliffe, Market Research | Phone: +1.703.273.7200, ext. 3047 | [email protected]
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Vertical Markets End-User Perspectives Study
GLOBAL CONTACTS: All contacts, by region
For this Vertical Markets End-User Perspectives Study, InfoComm interviewed 130 end users in seven
vertical markets globally. Additionally, to supplement the information provided by end users, InfoComm
contacted approximately 40 industry participants, including integrators, manufacturers, consultants,
distributors, rep firms and industry publications.
Total Contacts by Region – all types
(percent of total contacts)
28%
30%
North America
Asia-Pacific
Europe
Middle East/Africa
8%
Latin America
20%
14%
© InfoComm International® 2015
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GLOBAL CONTACTS: End-User Interviews, by vertical market
The Retail Vertical Market Assessment is one in a series of reports published by InfoComm, collectively
the Vertical Markets End-User Perspectives Study. InfoComm interviewed 130 end users in the following
seven vertical markets globally.
End-User Interviews by Vertical Market
(percent of total end-user interviews)
Healthcare
Corporate
11%
22%
Government
12%
12%
16%
Retail
12%
Education
15%
Hospitality
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Venues
Vertical Markets End-User Perspectives Study
Vertical Market Assessment
RETAIL
© InfoComm International® 2015
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RETAIL: End-User Interviews
InfoComm interviewed end users in the retail vertical market globally, including:
ƒ
Stores/chains: store chains (big box, department, grocery/convenience, fashion, technology),
large independent stores, corporate stores
ƒ
Malls/centers: malls, shopping centers
Retail End Users – Interviews by Region
(percent of total retail end-user interviews)
27%
34%
North America
Asia-Pacific
Europe
Middle East/Africa
13%
Latin America
13%
13%
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Vertical Markets End-User Perspectives Study
RETAIL: Executive Summary
ƒ
As technology becomes pervasive in our
everyday lives, customer expectations are
increasing that technology will be an integral
part of the shopping experience.
ƒ
As reported in InfoComm’s 2014 Market
Definition and Strategy Study, the global
retail pro-AV market will grow from $5.6
billion in 2014 to $6.9 billion in 2016.
ƒ
We have entered what end users refer to as
the “mobile age of retail.” Customers are
better informed than ever before and they
have all the information they want at their
fingertips.
ƒ
End users project increased spending on AV
technology. The retail market is projected to
grow at an 11 percent CAGR for the next
two years, which is a slightly lower rate than
the overall market.
ƒ
Consumers are relying on their mobile
devices to deliver information and
convenience, and their expectations are
raising the bar for the retail industry.
ƒ
ƒ
There is a growing demand, especially with
millennials, for anywhere, anyplace, anydevice connectivity, and this expectation
extends to the retail environment.
Most of the growth in this segment is in the
high- end of the retail segment, while the
low end is more cost conscious and driven
by the trend to lower-cost displays and outof-the-box digital signage offerings.
ƒ
Retail in Asia-Pacific is booming, although
end users acknowledge they lag behind
international standards. The growing
“Technology is changing the way we operate in a major way. A
lot of retailers are having to reinvent themselves and
struggling in the face of Amazon and the Internet. Most people
that have uncovered the formula have kept it to themselves.”
(big box store chain, U.S.)
© InfoComm International® 2015
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number of shopping malls in Asia-Pacific and
a rapidly expanding middle class are helping
to drive growth in the retail sector across
the region.
o
o
ƒ
ƒ
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In China, the number of shopping malls
has almost doubled over the past three
years. Meanwhile, the consumer class
is expected to grow 70 percent over
the next five years, reaching 220
million consumers by 2020, as reported
in Jones Lang LaSalle’s China60 report.
According to the Boston Consulting
Group, the retail market in India will
grow from $600 billion in 2015 to $1
trillion in 2020.
In Latin America, some retailers use no
technology, while a few have invested in the
most advanced technology. For the most
part, retailers in Latin America prefer lowcost solutions.
The Middle East has a dynamic retail
market, driven by growing populations,
more urban centers and increasing wealth.
With Dubai hosting the 2020 World Expo
and Qatar the 2022 World Cup, the region’s
construction boom will continue, and retail
will undoubtedly benefit.
ƒ
The increasing amount of data on the
network, coupled with a number of recent
high-profile data breaches, make planning
for and preventing cyber-attacks a top
priority for retail CIOs.
ƒ
According to the National Retail Federation/
Forrester Research “Retail CIO Agenda 2015:
Secure and Innovate” report, managing data
security is the number one area of focus for
retail CIOs in the coming year.
ƒ
The way we shop is different today, and
leading retailers are looking to deliver a
seamless cross-device experience across all
channels, so the shopper can easily make
the jump from one channel to another.
Forrester cites omnichannel initiatives as the
second most important area of focus for
CIOs in 2015.
ƒ
Consumers are gravitating to brands that
are technology savvy. So merging digital and
in-store experiences is critical for brick and
mortar’s continued relevance.
ƒ
End users report that consumers expect to
see dynamic content everywhere they look.
This is driving investment in digital signage
technology, with an outlook for continued
strong spending.
Vertical Markets End-User Perspectives Study
ƒ
ƒ
Sophisticated retailers are increasing
their use of integrated technology
solutions to manage security and store
operations. Surveillance cameras are
increasingly leveraged for both security
and video analytics purposes. This trend
is far more prevalent in retail compared
to other verticals, where security is
typically handled separately from AV
and IT.
The levels of interest and investment in AV
technology varies widely from end user to
end user. The decision to invest or not invest
in AV has little to do with the nature of the
retail business and more to do with the
retailers’ beliefs about technology. For
example, the following two responses come
from end users that are both addressing the
same challenge.
o
“We are a high-volume, low-margin
business, so we have to use technology
to be competitive against the Amazons
of the world.”
(regional home furnishings chain, U.S.)
o
“We are a high-volume, low-margin
business and margins are getting
tighter. There is not a lot left over to
invest in technology. For our business,
AV is still a luxury.”
(big box retail chain, U.S.)
ƒ
These two retailers could not have more
different opinions about their need to invest
in technology and the perceived benefits.
Retail brands that are not investing
in the latest digital, mobile and
social technologies will continue to
fall further behind.
© InfoComm International® 2015
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